[Federal Register Volume 63, Number 178 (Tuesday, September 15, 1998)]
[Notices]
[Pages 49372-49374]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-24694]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 35-26914]
Filings Under the Public Utility Holding Company Act of 1935, as
Amended (``Act'')
September 8, 1998.
Notice is hereby given that the following filing(s) has/have been
made with the Commission pursuant to provisions of the Act and rules
promulgated under the Act. All interested persons are referred to the
application(s) and/or declaration(s) for complete statements of the
proposed transaction(s) summarized below. The application(s) and/or
declaration(s) and any amendments is/are available for public
inspection through the Commission's Office of Public Reference.
Interested persons wishing to comment or request a hearing on the
application(s) and/or declaration(s) should submit their views in
writing by October 5, 1998, to the Secretary, Securities and Exchange
Commission, Washington, D.C. 20549, and serve a copy on the relevant
applicant(s) and/or declarant(s) at the address(es) specified below.
Proof of service (by affidavit or, in case of an attorney at law, by
certificate) should be filed with the request. Any request for hearing
should identify specifically the issues of fact or law that are
disputed. A person who so requests will be notified of any hearing, if
ordered, and will receive a copy of
[[Page 49373]]
any notice or order issued in the matter. After October 5, 1998, the
application(s) and/or declaration(s), as filed or as amended, may be
granted and/or permitted to become effective.
Conectiv, et al.
(70-9331)
Notice of Proposal To Amend Charter and Authorize Registered Holding
Company To Acquire Preferred Stock of Utility Subsidiary; Order
Authorizing Solicitation of Proxies
Conectiv, a registered holding company, located at 800 King Street,
Wilmington, Delaware 19989, and its wholly owned public-utility
subsidiary, Atlantic City Electric Company (``ACE''), located at 6801
Black Horse Pike, Egg Harbor Township, New Jersey, 08234, have filed an
application-declaration under sections 6(a), 7, 9(a), 10, 12(c), 12(d)
and 12(e) of the Act and rules 43, 44, 51, 54, 62 and 65 under the Act.
In summary, ACE proposes to amend its charter to eliminate a
provision restricting the amount of securities representing unsecured
indebtedness issuable by ACE and to solicit proxies in connection with
this proposal. In addition, Conectiv proposes to acquire shares of ACE
preferred stock and sell those shares to ACE.
ACE has outstanding 18,320,937 shares of common stock, $3.00 par
value, all of which are held by Conectiv. ACE also has outstanding
300,000 shares of Cumulative Preferred Stock, $100 Par Value (``Par
Preferred'') issued in six series.\1\ In addition, ACE has 239,500
shares outstanding of Preferred Stock, No Par Value (``No Par
Preferred'' and together with the Par Preferred, ``Preferred'') issued
in one series.
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\1\ The six series of Par Preferred consist of a 4% series, of
which 77,000 shares are outstanding; a 4.10% series, of which 72,000
shares are outstanding; a 4.35% series, of which 15,000 shares are
outstanding; a 4.35% series, of which 36,000 shares are outstanding;
a 4.75% series, of which 50,000 shares are outstanding; and a 5%
series, of which 50,000 shares are outstanding.
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ACE's Agreement of Merger, dated May 24, 1949, as amended on April
8, 1952 (``ACE Charter''), contains a provision restricting the amount
of securities representing unsecured indebtedness issuable by ACE. ACE
requests authority to remove this provision from the ACE charter. In
connection with this proposal, ACE also requests authority to solicit
proxies from the holders of its outstanding shares of each series of
Preferred for use at a special meeting of its stockholders (``Special
Meeting'') to consider an amendment (``Proposed Amendment'') removing
this provision. Consent by two-thirds of the aggregate shares of
Preferred and common stock outstanding and by two thirds of the
Preferred stock outstanding is required to adopt the Proposed
Amendment. Conectiv intends to vote all shares of common stock in favor
of the Proposed Amendment. In addition, ACE proposes to make a special
cash payment of $1.00 (``Special Payment'') to each holder of Preferred
for each share of Preferred voted in favor of the Proposed Amendment if
the Proposed Amendment is adopted, except as described below.
ACE proposes to remove the unsecured debt restriction for several
purposes. ACE desires to issue debt without using the overly
restrictive and expensive first mortgage bonds under which secured debt
is currently issued. In addition, ACE wishes to take advantage of
unsecured financial instruments which are designed to enhance a
company's overall credit structure and allow for better management of
the company's cost of capital. ACE also desires to issue additional
interim unsecured debt in order to obtain the best terms available in
the market for permanent capital financing.
Concurrent with the ACE proxy solicitation, Conectiv proposes to
undertake a program of stock acquisition, through December 31, 2000,
through cash tender offers (``Tender Offers'') for all six series of
the Par Preferred (``Tendered Series'').\2\ The price to be offered
each share of the Tendered Series will be established through market
conditions or through a redemption at the call price of $100 or at par
value (``Purchase Price''). The Tender Offer for any share is
conditioned, among other things, on the vote of that share in favor of
the Proposed Amendment and the adoption of the Proposed Amendment at
the Special Meeting.\3\ Subject to the terms of the offering documents
for each Tendered Series (``Offer Documents''), ACE will purchase for
the applicable Purchase Price those shares of any Tendered Series that
are validly tendered and not withdrawn prior to the expiration date of
the Tender Offer for that series (``Expiration Date''). Tenders of
shares made under the Tender Offers may be withdrawn at any time prior
to the Expiration Date. After the Expiration Date, all such tenders are
irrevocable, subject to certain exceptions identified in the Offer
Documents. Shares tendered in accordance with any Tender Offer will not
qualify for the Special Cash Payment.
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\2\ Conectiv does not propose to make an offer to acquire the No
Par Preferred.
\3\ If the Proposed Amendment is not adopted at the Special
Meeting, Conectiv may nonetheless proceed with the Tender Offers in
order to facilitate a subsequent solicitation of proxies to seek
adoption of the Proposed Amendment. In addition, ACE may choose to
solicit consents to a waiver of the unsecured short-term debt
restriction, as permitted by the ACE charter. ACE is not now
requesting authority to engage in a subsequent solicitation of
proxies with respect to the Proposed Amendment or a solicitation of
a waiver.
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To tender shares in accordance with the terms of the Offer
Documents, the tendering stockholder must comply with a guaranteed
delivery procedure specified in the Offer Documents. Alternatively, the
tendering stockholder may send a properly completed and duly executed
letter of transmittal and proxy with respect to the Proposed Amendment
to the depositary for the Tender Offers (``Depositary''), together with
any required signature guarantees and any other documents required by
that letter of transmittal and proxy. In that case, certificated shares
tendered must be received by the Depositary by the Expiration Date and
confirmation of the delivery of book-entry securities must be received
by the Depositary by the Expiration Date.
At any time and from time to time, Conectiv may extend the
Expiration Date applicable to any series by giving notice of that
extension to the Depositary, without extending the Expiration Date for
any other series. During any such extension, all shares of the
applicable series previously tendered will remain subject to the Tender
Offer, and may be withdrawn at any time prior to the Expiration Date as
extended.
Conectiv may elect in its sole discretion to terminate one or more
Tender Offers prior to the scheduled Expiration Date and not accept any
shares tendered, if any of the conditions to closing enumerated in the
Offer Documents occurs. Conectiv will notify the Depository of any
termination and make public announcement of the termination.
In addition, Conectiv reserves the right in the Offer Documents to
amend one or more Tender Offers in any respect by making a public
announcement of the amendment. Also, if Conectiv materially changes the
terms of a Tender Offer or the information concerning a Tender Offer or
if Conectiv waives a material condition of a Tender Offer, Conectiv
will extend the applicable Expiration Date to the extent required by
law.
Conectiv requests authority through December 31, 2000 to sell to
ACE all shares of Preferred acquired by the Tender Offers and ACE
proposes
[[Page 49374]]
through December 31, 2000 to repurchase those shares for the applicable
Purchase Price, plus expenses of sale. ACE will retire and cancel the
shares so acquired.
Conectiv requests that the effectiveness of the application-
declaration with respect to the proxy solicitation be permitted to
become effective immediately under rule 62(d).
It appears to the Commission that the application-declaration, to
the extent that it relates to the proposed solicitation of proxies,
should be permitted to become effective immediately under rule 62(d).
It is ordered, that the application-declaration, to the extent that
it relates to the proposed solicitation of proxies, be permitted to
become effective immediately, under rule 62 and subject to the terms
and conditions prescribed in rule 24 under the Act.
For the Commission, by the Division of Investment Management,
under delegated authority.
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 98-24694 Filed 9-14-98; 8:45 am]
BILLING CODE 8010-01-M
